DailyPlay – Opening Trade (TTWO) – January 28, 2025

TTWO Bearish Opening Trade Signal

Investment Rationale

Take-Two Interactive Software, Inc. (TTWO) recently broke down from its trading range with strong momentum, underperforming the S&P 500, and presenting potential for further downside toward a $160 target. The stock appears significantly overvalued, trading at a forward P/E ratio of 23.84x, slightly above the industry average of 21.41x, with deeply negative net margins of -66.4% compared to the industry average of 17.86%. Although its expected revenue growth of 18.23% surpasses the industry average of 12.05%, the company’s projected EPS growth remains flat at 0%, far below the industry’s 19.19% average. Take-Two is scheduled to announce earnings on Thursday, February 6.

TTWO – Daily

Trade Details

Strategy Details

Strategy: Short Call Vertical Spread

Direction: Bearish Credit Spread

Details: Sell to Open 3 TTWO Feb 28 $195/$205 Call Vertical Spreads @ $3.30 Credit per Contract.

Total Risk: This trade has a max risk of $2,010 (3 Contracts x $670) based on a hypothetical $100k portfolio risking 2%. We suggest risking only 2% of the value of your portfolio and divide it by $670 to select the # contracts for your portfolio.

Counter Trend Signal: This is a bearish trade on a stock that is expected to pull back from an area of resistance.

1M/6M Trends: Bullish/Bullish

Relative Strength: 9/10

OptionsPlay Score: 104

Stop Loss: @ $6.60 (100% loss to value of premium)

View TTWO Trade

Entering the Trade

Use the following details to enter the trade on your trading platform. Please note that whenever there is a multi-leg option strategy, it should be entered as a single trade. 

PLEASE NOTE that these prices are based on Monday ‘s closing prices. Should the underlying move significantly during the pre-market hours, we will likely adjust the strikes and prices to reflect a more accurate trade entry. 

View TTWO Trade